Robi Axiata, the country's second largest mobile phone operator, made its debut trading with a 50% surge in share prices in both stock exchanges on Thursday.
Its share prices rose to Tk15 from Tk10 each. As per rules, a newly-listed company's share prices cannot rise more than 50% on the first day.
Buyers offered to buy above 18 crore shares at Tk15 apiece, with investors showing great interest in Robi's shares on the first day of trading. But only 1.17 lakh shares of the company were traded on the first day in the Dhaka Stock Exchange (DSE).
Because there were a very few number of sellers in the market as most Initial Public Offering (IPO) winners were reluctant to give up their shares at this price.
Market insiders said after almost a decade, Robi has been listed on the capital market as a multinational company.
On the first day, most investors did not go for selling Robi shares as they expected their prices to go further up.
Robi's IPO received almost six and a half times more applications from general investors.
But Robi sold about 52 crore shares through the IPO. Of them, about 39 crore shares are sellable. The remaining shares have been locked in for different periods.
The company has raised Tk523.79 crore from the capital market to expand its network. Of the amount, Tk388 crore is being taken from external investors, while Tk136 crore from its own employees under the Employee Stock Purchase Plan.
As per rules, newly-listed companies cannot be included in the index on the first trading day. They will be added to the index after a three-month review on their performance based on various criteria. That is why there was no impact of Robi's share price hike on the main index of the exchanges.
If Robi Axiata meets the criteria, it will get a place in the index in March.
On Thursday morning, the ring bell ceremony of Robi took place at the DSE and the CSE (Chittagong Stock Exchange) offices in the capital.
Mahtab Uddin Ahmed, Robi's managing director and chief executive officer, said, "As the nation steps into the 50th year of independence, we are truly humbled to have arrived at the country's stock markets with the biggest ever IPO. Robi, as a brand, has been celebrating the rich culture and heritage of the country since its inception. But from today onwards, Robi's future will be interlinked with our local and our foreign investors."
"I can assure our shareholders that we are pursuing the right digital vision and have created a management team who are skilled and experienced enough to deliver the vision. However, it does not mean that everything will happen tomorrow, or the day after. Please note that we are chasing a long-term digital vision that will come true over the years," he added.
He said, "With growing market readiness for digital lifestyle, we are confident that the regulatory barriers that inflict the industry at present will be gradually lifted."
Meanwhile, a signing agreement for listing has also been conducted between Robi and the DSE at the latter's office in the capital on Thursday morning. The agreement was signed by Md Abdul Latif, acting chief regulatory officer and Shahed Alam, company secretary of Robi.
Indian High Commissioner in Dhaka Vikram K Doraiswami and Malaysian High Commissioner in Dhaka Haznah Md Hashim were present in the signing ceremony.
Among others, DSE chairman Md Yunusur Rahman, its Managing Director Kazi Sanaul Hoq, Robi Axiata Managing Director Mahtab Uddin Ahmed and IDLC's Managing Director, Arif Khan also took part at the event.
Vikram K Doraiswami said, "We congratulate Robi and the DSE for this IPO. At the same time, I wish every investor to get the best return on their investment." Haznah Md Hashim said, "Robi Axiata is one of the largest foreign investors in Bangladesh. Listing of Robi on the capital market is a big step for public enrollment. It is a manifestation of the long-standing relationship between Malaysia and Bangladesh."
Robi is a joint venture of Axiata Group Berhad based in Malaysia, and Bharti Airtel, the global telecom headquartered in New Delhi, India, with Axiata holding the majority shares in the joint venture.
After the merger with Airtel Bangladesh in 2016, the company emerged as the second largest telecom operator and retained the same name.
The company informed that the Bangladesh Telecommunication Regulatory Commission has renewed the 900MHz and 1800MHz spectrum band on 20 December 2020 for 15 years. The total spectrum assignment fee is $239.77 million, which is payable into six installments till 2025.
At present, the market leader, Grameenphone, has 37MHz spectrum, Robi 36.4MHz, Banglalink 30.6MHz, and Teletalk 25.2MHz in three different bands.
As per un-audited consolidated financial statements, in the third quarter of 2020, Robi's net profit stood at Tk38.88 crore and basic earnings per share (EPS) was Tk0.08. In the previous year, the profit amounted to Tk170.67 crore and the EPS was Tk0.36.
In the first nine months of this year, the company's net profit stood at Tk116.03 core and basic EPS stood at Tk0.25. In 2019, the company's profit was Tk113.85 crore and basic EPS was Tk0.24.